What Chait and Noah said about the deal that hopefully won’t happen. As always, it’s not that I’m opposed to any possible deal that makes concessions on tax rates, but I’m certainly opposed to concessions when the Republicans aren’t actually offering much of anything in return.

And, since apparently it can never be pointed out enough, I cannot endorse more strongly what Reeve says about the idea that $250K isn’t an upper-class income bracket. Again, living in a desirable urban area is something you’re getting with your money — if you want to use your high income for more vacations or ivory backscratchers move to the suburbs and put the kids in public school.

Comments (95)

I’m pulling for the “backup” plan of 250k cuts plus unemployment extension. Let the next Congress deal with it. Come to think of it, that should have been Obama’s line all along. Extend everything to let the next Congress deal with it. But Obama apparently prefers both self-imposed deadlines and dealing with an impossible Tea Party faction, for some reason.

Sorry, blue, I don’t know what any of that is supposed to mean, except that the term “11 dimensional” is a way of pretending that it isn’t gob-smackingly naive to say that we should unquestioningly accept the public posturing of a politician engaged in an ongoing negotiation/political fight.

Obama acting the part of someone who wants to make a deal, but making sure it doesn’t happen, when it’s in his political interest for the other guy to look like the one who wouldn’t make the deal happen.

It’s what he did with the debt ceiling talks in 2011 – saying he’d go along with all sorts of entitlement benefit cuts, but demanding $1 trillion (did I say $1 trillion? I meant $1.4 trillion) in tax increases. There was no way the Republicans were ever going to agree to that, but the Republicans took the hit for the crisis.

It’s what he did when Malaki wanted to extend the troop presence – saying that the Iraqis would need to agree to legal immunity for American troops as a precondition for talks. There was no way that Iraqi government would ever agree to that, but he didn’t have to tell a wavering ally “No.”

And it looks for all the world like what he’s been doing on these talks.

“Wheels within wheels, man. I got evidence for all theses assertions–it’s just not the kind you can, y’know, see.”

Yeah, you have to be totally in the know to imagine that House Republicans won’t agree to any deal that includes higher taxes on rich people and/or more public money for poor people. Next you’ll be telling me they have an oompaloompa for a Speaker.

You’ve to to admit, though, Brien: the idea that the Iraqi government would never give American troops legal immunity, and that this was easy to predict, is completely and totally unsupported. I don’t know I come up with this stuff.

This is a reasonable point. People say things to the media for strategic reasons, so they’re hard to interpret. You see this particularly clearly in Europe, where the two weeks before any EU deal are filled with people pronounced off the record that no deal is possible.

Joe – since you can see the outline of Obama’s actual plans, can you enlighten us? I can’t see what he wants, just as I could never see those fucking sailboats in the dots.

What are the bright lines? Will Obama demand a permanent debt ceiling fix? Will he get a payroll tax extension? What revenue limits does he have?

Second, can you give some falsifying ground rules? That is, what deal, if it is cut by the White House, will demonstrate that you didn’t actually see the boat? Are you certain, seeing the outline of this eventual deal, that it will include a debt ceiling agreement? That it won’t trade permanent tax cuts for temporary safety net spending?

I would love to believe that you see a boat, and it’s the real boat. I’d just like to know more about the boat, so I can try to see it too, or at least figure out after the fact if it was really there.

I think at this point that this is indeed what the Administration is doing.

I was previously skeptical but it would appear, given the evidence, that lying about what it considers an acceptable deal because they know for a fact that the Republicans won’t accept it and they can look good to the Villagers while giving away essentially nothing is indeed the administration strategy. They’ve done it so many times at this point that, while it isn’t ironclad, it seems like there’s a very good chance this is the proper read.

But what troubles me is how you get from here to an actual GOOD deal. I would note that back in 2011, the debt ceiling talks… the White House didn’t really WIN on those. It fought the Republicans to exhaustion and the best it could get was a mutual agreement to kick the can down the road to… now.

I mean, this paints the Republicans into a corner, does it not? If they said no to a string of increasingly sweet deals, how do they turn around and say ‘yes’ to something that raises taxes and doesn’t slash entitlements or discretionary spending at all? Isn’t it more likely they either try and kick the can (again) or they simply shoot the hostage?

This isn’t precisely the White Houses fault; the Republicans are, well, crazy. But we may very well have reached the point where the only things they’re willing to accept as a buy-off are things that actually dismantle core parts of the New Deal and/or Great Society, or that cut already too-thin necessary discretionary spending; we’re actually looking at a gap in satellite coverage of hurricanes in a few years due to lack of funds, just as an example.

And that just puts Obama in an impossible position, where he can either be the first Democratic President to cut Social Security and Medicare in exchange for keeping the lights on, or the Republicans actually WILL torpedo the economy and country.

In this particular case, I think that there’s an out: the turning of the calendar means that Republicans could vote for exactly the tax levels Obama wants and brag that they supported a tax cut.

But in general, yeah, it’s going to be an ugly few years. I don’t see any way out except to do them so much political damage that they lose election after election, and either come to the senses out of self-interest or lose all of their power.

I think that there’s an out: the turning of the calendar means that Republicans could vote for exactly the tax levels Obama wants and brag that they supported a tax cut.

To be honest, I view the permanent locking in of Bush-level tax rates even on low earners to be a partial Republican victory.

But even given this… right now we desperately need the debt ceiling to be raised, the sequester dealt with, unemployment benefits continued, and if possible some sort of mini-stimulus. To say nothing of the increases in domestic discretionary spending required if we’re to continue having even a nominally functional basic infrastructure.

And I can’t see the Republicans voting for any of that, ever.

Which, I suppose, is a way of agreeing with you it’s going to be an ugly few years.

Unfortunately, Obama didn’t deal early enough with the debt limit the first time which ended up with the TeaBaggers understanding it’s power sooner. But give them credit they didn’t show any restraint when Clinton was president (shutdowns, impeachment, etc) so it’s unlikely they would be behaving any differently now. Debt limit in two months. Sequestration along with it. Then the budget/appropriation bills. It’s going to be a harrowing 2-4 years of constant hysteria.

Nihilists destroy things, that’s what get’s these Republicans up in the morning. They are like these mass killers, instead of just turning the gun on themselves they want to take the whole country down first.

Unfortunately, Obama didn’t deal early enough with the debt limit the first time which ended up with the TeaBaggers understanding it’s power sooner.

What could he have done differently, tho?

I mean, he fought the Republicans to absolute exhaustion on that and the best thing he was able to get was them agreeing to keep the lights on in exchange for kicking the can down the road to… now.

You could argue that he should have simply gone ‘no, fuck YOU. Shut it all down’ and toughed out an actual government shut down until he got a clean raise. And you might even be right; eventually, you have to let these guys shoot their hostage because the long-term damage they do with their constant hostage taking is awful.

But a government shutdown imposes very real human costs. It’s not just that national parks shut down; literally millions of people who depend on our governing institutions are left high and dry. I’d be reluctant to pull that trigger, although at some point it may be necessary.

Now, the Obama offer to Boehner was not a full extension of tax cuts under $400,000. The plan was to get higher revenue on income below that level by reducing tax deductions rather than raising rates. But the news reporting cast the offer as simply moving up the threshold, and Obama did nothing to correct that impression. And so the effect of Obama’s concession to Boehner — which of course went unrequited — was to reset the tax debate at a new, more GOP-friendly level.
Worse, exposing Obama’s willingness to move his seemingly unmovable demand emboldened Republicans to demand even more. If they could push the line to $400,000, why not $500,000? Maybe cut Social Security too?

Why would Chait think that the Republicans who are actually involved in the negotiations, and know the actual proposals, would make their judgments about Obama’s position based on press reports, instead of on the actual proposals being floated?

“Again, living in a desirable urban area is something you’re getting with your money”

Exactly. I used that exact analogy to explain the difference between housing prices in Oakland County, MI and Los Gatos, CA when I moved from Michigan.

Q: How can you pay $1M for your house that’s smaller than my home in Farmington Hills?

A: Think of this. Your home in Farmington Hills is different than the rest of the homes in your neighborhood. First, your home is about 150 ft above (MI) grade level and you can see all the way to downtown Detroit if you want to. Second, you can have breakfast in Capitola 25 minutes after you are dressed in the morning. Third, on the weekend you can go to San Francisco, Sausalito, Carmel, or Point Lobos in about an hour. Fourth, your career options are virtually unlimited (compared to Michigan). Fifth, world class destinations (Tahoe, Yosemite, Big Sur) are attainable within hours.

Lastly, in all of Farmington Hills, these options are only available from your property.

POTUS’ remarks did not sound like a prelude to a “cave,” and neither did the GOP’s”outraged” response to them.

Unemployment benefit extension is the only real reason to reach a deal at all – otherwise, going over the cliff/curb/whatever would simply set up a better bargaining position for the 113th Congress. How fast could the 113th act (assuming the 113th House is more capable of doing its job)?

No, getting rid of the debt ceiling is the only reason to deal now. While the unemployment benefits are important, they have already been cut twice last year and fewer and fewer people will qualify for them due to how they work.

I agree that earned income of $250K a year makes puts one ” upper-class income bracket,” but Reeve’s contention is that earned income of $250K makes someone “rich.” I would dispute that characterization. “Rich” is being able to live an upper middle-class lifestyle indefinitely based purely on capital gains, interest payments, and other forms of investment income. There are plenty of law firm partners who earn $250K or more a year, but also have to work 14 hour days, weekends, etc., to sustain it, which is clearly qualitatively different than someone who may choose to work because they enjoy it, but could also choose to go sit in a nice beachfront condo in Tahiti for the rest of their life without lifting a finger.

Someone who “earns” $75,000 a year from their inherited trust fund, without actually having to work at all, is quite plausibly more privileged than someone who earns $250,000 a year but has to work 70 hours a week at a law firm or brokerage. Of course, both people are far more privileged than the average American, but with the latter, there’s always the obfuscating smokescreen of I WORKED SO HARD TO GET HERE HOW DARE YOU TAX ME, while it’s much harder for the trust fund baby to plausibly make that claim, even if his/her annual income isn’t as high.

Yeah, notice that the deal in question “only” bumps the tax cut extension up to $450,000, while leaving the estate tax exemption at five million dollars. Because otherwise trust fund parasites wouldn’t be able to look forward to using Beluga caviar for their anal massages.

If you’re going to go that route, you might as well concede the right-wing talking point that by some metrics almost all Americans are better off than kings were millenia ago, so we’re almost all indeed rich.

Which is why there are suburbs. There also plenty of places in all of those cities where people live on one tenth of that. As Scott says, being able to live in a desirable area of a desirable city is a perk that comes with wealth.

But the suburbs ain’t exactly cheap either. Commuting costs, real estate taxes and child care costs are astronomically high in the burbs. I ain’t bitching and paying taxes is a great problem to have bc it sure as hell beats the alternative, but 250k a year in the suburbs of new York is middle class. Nothing more. Nothing less. Having said that, I do support an increase on income above 250. It’s fair and necessary. But it’s more important in my opinion to increase taxes on capital gains and to create more income tax brackets on the higher end. All income above 250 should not be treated the same and capital gains should be taxed like income.

Obama’s problem is that he approaches this matter as somebody who actually cares about reducing the deficit (however misguided and deleterious a position that is in the current economic context) and chasing the approval of deficit scolds, while the GOP cares only about minimizing and then reducing taxes on rich people–but somehow convinces said deficit scolds and the rest of “Washington” that they care far more about The Deficit and The Debt than do Obama and the Democrats.

The end result? Obama preemptively hands the GOP concessions, which the GOP pockets while saying those just aren’t good enough. “Washington” then demands that Obama give a little and then a lot on “entitlements” in order to show “good faith” because, hey, the Republicans have decided to let taxes rise to a microscopic degree on .001% of the population, which was, like, an incredibly hard and noble step for them to take. So, the GOP ends up trading a temporary rise in taxes for the super-rich (which they’ll get rid of the second they get the chance) in exchange for massive cuts to Medicare and Social Security which will be covered in Democratic fingerprints and which the GOP will spend all of 2014, 2016, and beyond hanging around the Democrats’ collective neck.

Obama really must be the worst negotiator ever. He’s had two years to get Republicans to agree to massive cuts to SS and Medicare (which ought to be like selling whiskey to Celts), but he still can’t close the deal.

The debt ceiling and taxes going up for anyone earning over $250K were loudly declared to be non-negotiables right before they all of a sudden become absolutely-negotiables. Obama offered massive cuts to Social Security and Medicare as part of the 2011 package; only the House GOP saved us from that. I myself prefer not to rely on John Boehner’s inability to control his own caucus as the firewall safeguarding two of the Democratic Party’s greatest legacies.

Right. The demand for $1 trillion in tax increases to make the deal, later revised to $1.4 trillion, had nothing to do with it.

Poor, innocent Barack Obama, taken by surprise again and again by how crazy the Republicans are, and repeatedly ending up with deals that just happen not to violate any of the red lines he set out at the beginning.

Obama’s “demand” for more revenue came after Boehner had essentially told him that $800 billion in new revenues (made up of fake “reforms” and the dynamic scoring unicorn, not rate hikes) was already way too much for the House GOP to swallow.

White House aides have been admitting to obscure outlets like The New York Times that they misjudged the GOP’s capacity and willingness for compromise in the first term. Judging by the deal that’s reportedly been cut, they haven’t learned much, either.

No way for a Democrat to win a deficit battle politically. Setting aside the problem of intramural strife from Dem interests that would result from a grand bargain, it’s a problem of conflicting interests. The people who care deep-down about balanced budgets are Republicans, but they’re just one interest in a GOP with many conflicting interests, and one with very sparse representation at the federal level (basically Tom Coburn and a couple reps). Trying to put a wedge between them and the national GOP is an intriguing goal, but no Democrat in the past thirty years has been able to do it yet, and unless you’re able to find some way to accomplish this, it’s a doomed effort.

250k was bad enough. And we got NOTHING for this. Nothing! We gave the Republicans something they wanted (tax cuts) and in return got… nothing.

Someone correct me if I’m wrong. Reports are sketchy at the moment, but from what I’m reading, we got no traction on the debt ceiling, no traction on the sequester, no extension of unemployment benefits, no… nothing. Instead we can do this all over again in March.

Like last time, you know, this sort of thing is KINDA important to some people, while everyone says the Dems should play chicken. (this isn’t targeted to fd2)

Also, from TPM:

“The Senate-passed legislation raises significantly more revenue than Boehner’s plan would have, and will provide the Treasury with more than $600 billion than it would have collected over the next 10 years if all the Bush tax cuts had been extended.”

Let me add to my separate comment that I do think the 450K like is stupid. Scott’s post linking to others discussing the matter underlines the sentiment. One provides a chart of the income levels a couple years back from NYC, my city. Over 50% of the population makes under 50K.

I personally think a single person can survive pretty well on 50K and families much less well survive on it. It’s not enough for a family to be “middle class,” surely, but a fraction of 450K will do the trick, thank you.

Even if Joe’s contention that Obama is a master of negotiation jujitsu is accurate, it still does matter. It is counter productive to be negotiating cuts and miniscule revenue increases at a time when the economy is stagnant, state govt’s are making more cuts and there is significant social need for infrastructure that, if funded, could spark economic growth.

Some people ask if Obama is a sell out. Some ask if he is stupid. Rather than fall into the liberal trap of speculating about Obama’s internal mental states, just judge the man by what he actually does.

Turns out Obama is a practical neoliberal who sees taxes as inefficient rent seeking that parasitically undermines the allocative and innovative efficiencies that emerge from unfettered markets. The role of the state is to facilitate markets to the greatest extent possible and to use the state to intervene only when necessary and as little as possible. Obama is a practical right winger, what used to be called a country club republican before the republicans became Bircher hillbillies.

Since Green Laternism proves that nothing is worth fighting for, just relax and embrace the country club Republican Obama. After all, there will always be a Bircher, or a fascist to scare you back onto your couch of complacency where you can do fall into the arms of Morpheus dreaming that Obama is a jujitsu genius at negotiating.

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